Undue Hardship Discharge of Student Loans in Pennsylvania
For students that wish to attain a college degree or receive higher education after the completion of college, student loans may be the only viable option. Unfortunately, after accumulating a large amount of student loan debt, a graduate may not end up in the desired field that offers them the salary they deserve. When this happens, it can become easy to get buried under a mountain of student loan debt. If you need assistance managing your student loan debt, contact an experienced Pennsylvania student loan discharge lawyer.
At Young, Marr, Mallis & Associates, we understand the difficulty of dealing with student loans while trying to manage other finances, and we are here for you. Our firm will work tirelessly to find a resolution that prevents student loans from monopolizing your income. To schedule a free consultation to discuss your legal options, contact Young, Marr, Mallis & Associates at (215) 515-6389.
U.S. Student Loan Debt Statistics
In the United States, the student loan debt has reached an aggregated amount of about $1.6 trillion when including federal and private student loans. The average amount of student loan debt is approximately $28,000 for students that graduated from a four-year school.
If a graduate opted to receive higher education and needed to apply for student loans, the average amount of debt is drastically increased. For example, the average amount of student loan debt for medical students is nearly $200,000. The average student loan debt for other higher education programs also fall within this excessive range of debt.
With this much student loan debt, pursuing an undue hardship discharge may be the only option for some graduates. To learn more about how to make a claim for undue hardship, you should continue reading and speak with an experienced Bensalem loan discharge attorney.
How Undue Hardship Claims Work
Many graduates are unaware that it is possible to discharge student loan debt through bankruptcy. However, there is a way for graduates to seek a discharge through bankruptcy.
A Chapter 7 bankruptcy is likely what you will have to file in order to make a claim for undue hardship. Chapter 7 bankruptcy involved a liquidation of assets to pay off creditors that then allows a debtor to wipe out debts like credit cards and medical bills. However, absent an undue hardship claim, a Chapter 7 bankruptcy will not automatically discharge student loan debt.
To initiate an undue hardship claim, you must file a lawsuit against the creditor that holds your student loans and allege that paying your student loans will lead to an undue hardship. Whether your student loan holder is the federal government or a private institution, you must provide evidence that shows that you cannot afford to pay your loans.
To determine whether you have provided sufficient evidence to obtain an undue hardship, multiple legal tests may be used to analyze your claim. One possibility is that you must meet the requirements of the Brunner Test. The Brunner Test lists three qualifications that must all be met for a borrower to satisfy their undue burden:
- Paying your student loans will leave you in a position of poverty (below a minimum standard of living)
- You have special circumstances that make it difficult to satisfy your loans, like having a disability that prevents you from working
- You demonstrated a good faith effort to repay your loans; this may include trying various payment plans and staying in contact with your student loan holder
Another test that is used to assess an undue hardship claim is the totality of the circumstances test. When using this test, the court will examine all of the circumstances that may prevent you from paying your student loans and will make a judgment regarding these circumstances. The totality of the circumstances test does not require that a borrower satisfy all the requirements listed in the Brunner Test.
Depending on the circumstances of your case and the court where the claim is filed, there may be alternative tests that are used to determine your undue hardship claim. Our firm can help you prepare for an undue hardship claim to ensure you have a high chance of being approved.
Work with Our Trusted Pennsylvania Bankruptcy Attorneys Today
If you are interested in applying for an undue hardship discharge for your student loans, consult with an experienced Pennsylvania bankruptcy attorney today. The legal team at Young, Marr, Mallis & Associates possess decades of combined legal experience, and we would be proud to use this experience to represent you. Our firm represents clients in Philadelphia, Bensalem, Doylestown, Bala Cynwyd, and across southeast Pennsylvania where you can visit us to discuss your case. To schedule a free legal consultation, contact Young, Marr, Mallis & Associates at (215) 515-6389, or contact us online.